Markets & Finance

Stocks Slide after Soft Economic Data

Stocks finished lower Wednesday, as a batch of soft economic reports helped send the Dow to its fourth consecutive daily loss. Traders were also considering a mixed bag of earnings reports, with other key economic data on tap later in the week.

On Wednesday, the Dow Jones industrial average fell 50.91 points, or 0.52%, to 12,031.02, hurt by weakness in United Technologies (UTX) and Alcoa (AA). The broader Standard & Poor's 500 index dropped 10.13 points, or 0.74%, to 1,367.81. The tech-heavy Nasdaq composite slid 32.36 points, or 1.37%, to 2,334.35.

The markets are unlikely to react much to the Nov. 7 elections, some analysts say. "In general, both the stock and the bond markets are fully reflecting the Republicans losing ground to the Democrats and losing one of the two houses," says Rob Brown, chief investment officer at Genworth Financial Asset Management.

A heavy slate of economic data was in focus Wednesday. The Institute for Supply Management's index of manufacturing activity fell to 51.2 in October, following September's decline to 52.9. The results were weaker than expected, but not as dismal as some feared after the soft Chicago PMI report, says Action Economics.

Construction spending dropped 0.3% in September, from a downwardly revised flat reading in August. Separately, the National Association of Realtors' pending home sale index for October dipped to 109.1 in October, above forecasts but down from September's 110.1 print.

Treasury yields resumed their recent downtrend after the reports on manufacturing activity, construction spending, and pending home sales all posted declines. The 10-year note rose in price to 102-15/32 for a yield of 4.56%, while the 30-year bond climbed to 97-06/32 for a yield of 4.68%.